BMW plans to set up second plant in India
Siddharth Vinayak Patankar, March 15, 2011, (Munich)

German premium carmaker BMW plans to set up its second plant in India. BMW is expanding capacity at its current facility in Chennai and has now hit 10,000 units annual production capacity. The company's board says even after production at its Chennai plant is further enhanced through a second shift of operations in 2011, it will require additional capacity.

The current plant is seen as inadequate for Indian operations beyond 2015. The Chennai unit also has little unused land to build a second greenfield plant and so BMW may have to scout for a new location.

The possible introduction of BMW's Mini brand, as well as localising other BMW volumes models also requires a second plant, according to the company's board member and incharge of global production, Frank-Peter Arndt. With the second plant proposed to be set up after 2015, BMW will consider shifting from assembling cars to full-scale manufacturing, he added.

BMW India had begun scaling up its production set-up in India from September last year to double production to 10,000 units. This has been achieved as on March 1 2011. The company will add a second production shift at the Chennai plant from mid 2011 to further enhance production numbers.

BMW will begin assembling the next generation X3 in India by June 2011. It expects large volumes by following an aggresive approach like it has with the X1, launched in December 2010. BMW has a total investment of Є 30 million in India so far, which includes the Є11.6 million infused into the recent expansion.

NDTV had first reported a few months ago that BMW was seeking large volumes capacity in the region of 50,000 units, in India as a part of its roadmap for 2020.